Food Stamps Texas Fraud

by on April 28, 2010

In an attempt to control Texas food stamp frauds and administrative costs Texas officials have come up with a program that dispenses the food stamp benefits by electronic means.

The program is called as Electronic Benefit Transfer. It has been experimented with in Texas and other seven states as a means to reduce food stamp fraud and waste by giving recipients a plastic debit card as compared to coupons that were earlier in use.

Texas has been testing it since October 1994 and it has not been expanded statewide resulting in the elimination of food stamps that are printed on paper. Around one million Texas household are using the plastic cards at various places to purchase and fulfill their food requirements.

The Texas State Comptroller, John sharp who proposed the system in 1991 stated that it has been a tremendous success and that the card does not work at a downtown street corner that sells cocaine. It works only at large groceries. The smaller groceries that use to accept stamps under the old system have been removed from the program.

Purchases of groceries have gradually increased since the system has gone into operation. In Dallas and Houston areas, the purchases have leaped a total of $10 million in the very first month once the system started even though the food stamps benefits had seen a slight decline but has been a success in curbing Texas food stamps fraud.

The cards have been used by 200,000 people who reap benefits under Aid to Families with Dependent Children, the Government’s most important cash assistance program.

As the system makes it difficult to trade, food stamp benefits on the black market officials say that recipients are buying more food. Every eligible person has an electronic account in which benefits are autonomously deposited every month. After the purchase no change is given, that means recipients are never given cash.

The electronic records make it easier to detect food stamp frauds. The authorities have already splintered many food stamp frauds and trafficking rings in Texas. They include a meat market that received coupons and gave cash in return of them.

In the United States, nearly 27 million people receive food stamps and Texas distributes about 10 percent of the nation’s estimated $24 billion in benefits. The average food stamps allotment is $292 a month for an eligible household. The new system will save administrative costs and save the federal government millions of dollars by eliminating mass mailings, armored car shipments that by shredding cost of food stamps that is estimated to be $24 million a year.

Comments on this entry are closed.

Previous post:

Next post: